CENGAGE | MINDTAP HW: Application: The Costs of Taxation Assignment 2. Taxes and wentare Consider the market for air conditioning units. The following graph shows the demand and supply for air conditioning units before the government imposes any taxes. First, use the black point (plus symbol) to indicate the equilibrium price and quantity of air conditioning units in the absence of a tax. Then use the green point (triangle symbol) to shade the area representing total consumer surplus (CS) at the equilibrium price. Next, use the purple point (diamond symbol) to shade the area representing total producer surplus (PS) at the equilibrium price. (?) Before Tax Demand 300 270 Equilibrium 240 A 210 Consumer Surplus 180 PRICE (Dollars per air conditioner 150 Supply 120 Producer Surplus 8 O 120 240 360 480 600 720 840 960 1080 1200 QUANTITY. (Air conditioners) Sunn MacBook Air F1 20 F3 F5 F6 F7 I FB F9 F10 F2 @ $ oo 5 6 18 O N P W E R T Y U O S D F G H K X C V B N MCENGAGE | MINDTAP HW: Application: The Costs of Taxation Assignment Suppose the government imposes an excise tax on air conditioning units. The black line on the following graph shows the tax wedge created by a tax of $60 per air conditioner. First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. (?) After Tax Demand 300 270 Tax Revenue 240 A 210 Consumer Surplus 180 Tax Wedge PRICE (Dollars per air conditioner 150 Supply 120 Producer Surplus 8 Deadweight Loss 120 240 360 480 600 720 840 960 1080 1200 QUANTITY (Air conditioners) MacBook Air 14 1I F8 F9 F10 F71 F2 BO F3 800 F4 F5 F6 F7 % A & @ # 8 9 O 2 3 5 6 E R U O P W T Y G H KCENGAGE | MINDTAP HW: Application: The Costs of Taxation Assignment 210 Consumer Surplus 180 Tax Wedge 150 Supply PRICE (Dollars per air condition Producer Surplus 20 90 Deadweight Loss 30 120 240 360 480 600 720 840 960 1080 1200 QUANTITY (Air conditioners) Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. Before Tax After Tax (Dollars) (Dollars) Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss Grade It Now Save & Continue Continue without saving MacBook Air BO F3 BOB F4 F5 - F6 F7 F8 F9 F10 % & 5 6 7 8 9 O E R T Y U O